The Bank of India has raised interest rates in a bid to curb rising inflation.
Central Bank Governor Shaktikanda Das said the monetary policy committee had decided to raise the repurchase rate by 50 basis points to 4.90%.
Six of the eight economists polled expected the central bank to raise repo rates by half a percentage point, with one forecasting a rise of 40 basis points and another predicting no change.
The war between Russia and Ukraine, both major commodity producers, has disrupted supply chains and increased inflationary pressures in the global economy.
The consumer price index in April rose to 7.79% compared to the previous year, after rising 6.95% in March, compared to the central bank’s target of 2% -6%.
The Monetary Policy Committee held an extraordinary meeting in May and unanimously decided to raise the repurchase rate by 40 basis points to 4.40%.
Das expects the country’s inflation to reach 6.7% in the fiscal year starting in April, higher than previous estimates of 5.7%.
The central bank continues to expect the economy to grow by 7.2%.
Source: Capital
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